FOREX-Dollar stays close to 2-month high vs. yen on Fed, BOJ views

TOKYO/SYDNEY, Nov 18 (Reuters) - The dollar and euro stuck close to recent highs against the yen in Asia on Monday, though uncertainty about how long the U.S. Federal Reserve will maintain its monetary stimulus capped gains.

"I think the market wants to keep risk-on trading, but some think the dollar/yen is high and aren't willing to go higher yet," said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo.

"But I think some people believe the dollar might go higher by the end of the year, so they want to keep their long positions in dollar/yen," he said.

Data on Friday showed currency speculators turned even more negative on the yen in the week ended Nov. 12, having held net short positions in the Japanese currency since late October.

"Short positioning has become more extreme during four of the last five weeks, and is now just marginally above the seven-year low," analysts at JPMorgan wrote in a note to clients.

The dollar added about 0.1 percent to buy 100.25 yen, not far from Friday's high of 100.43 yen, he highest point since Sept. 11.

The euro rose slightly to 135.21 yen not far from the Oct. 22 peak of 135.52, a high not seen since November 2009.

The Fed is poised to taper its monthly bond purchases of $85 billion, with most investors expecting the central bank to begin paring by March 2014.

Compared with the Fed and the European Central Bank, the Bank of Japan is the most aggressive in providing monetary stimulus as it works to pull the world's third-biggest economy from two decades of stagnation. The BOJ will hold a regular policy meeting this week and is expected to maintain its ultra-loose policy.

Markets will also be keeping an eye on minutes of the Fed's Oct. 29-30 meeting, due on Wednesday, and a string of speeches from Fed officials including Chairman Ben Bernanke, scheduled to speak on "Communication and Monetary Policy" on Tuesday.

Dovish comments last week from Fed Chairman-nominee Janet Yellen have gone some way to assure markets there will be no imminent decision to scale back its massive bond-buying programme.

Still, investors are keeping a close eye oncoming U.S. data to gauge the timing of any tapering. A key piece on data, due on Wednesday, is October retail sales

Uncertainty about when the Fed will move has unsettled the dollar, allowing the euro to rally nearly 1 percent last week and recoup some of the steep losses suffered in the previous two weeks. The European unit last traded at $1.3490, near late New York levels on Friday.

That, in turn, brought the dollar index down slightly from Friday's late levels. At 0330 GMT, it was at 80.820.

In Australia, minutes of the Reserve Bank of Australia's (RBA) Nov. 5 policy meeting are due on Tuesday. At that meeting, the central bank left interest rates steady at a record low 2.5 percent, as expected.

While the RBA has left the door open to more interest rate cuts, it is reluctant to ease further given there is already plenty of monetary stimulus in the economy.

Instead, it is hoping for the currency to weaken in order to provide more support to Australia's exports and spur a broader recovery.

The Australian dollar last stood at $0.9377, slightly higher but down nearly 4 percent since Oct. 23, when it scaled a peak of $0.9758.